BofA Reaches Settlement on Last Remaining Mortgage Crisis Suit

New York, NY, March 6, 2015—A New York state appeals court approved Bank of America Corp's $8.5 billion settlement with mortgage securities investors in its entirety, reports Reuters.

The decision by the Appellate Division in Manhattan likely resolved one of the bank’s last and largest legal liabilities related to the financial crisis. Bank of America is the second-largest bank in the U.S.

Reuters says that Bank of America agreed to the 2011 settlement with 22 institutional investors, including BlackRock Inc., MetLife Inc. and Allianz SE's Pacific Investment Management Co. to resolve claims over $174 billion of mortgage securities issued by the former Countrywide Financial Corp.

Many of these securities went into default after Bank of America bought Countrywide in 2008, leading to huge losses.

Some investors claimed the settlement shortchanged them.They said Bank of New York Mellon Corp., which negotiated the accord as trustee for 530 trusts involved in the case, did not work hard enough to recover more money, reports Reuters.